Update 2022/12/30 at 5:24pm ET: Rogers and Shaw said they were notified that the Commissioner of Competition will appeal the Competition Tribunal’s decision to permit the proposed merger. Moreover, the commissioner is applying for an injunction to prevent the proposed transactions, including Quebecor’s purchase of Freedom Mobile, from closing until the appeal can be heard by the Federal Court.
Per The Globe and Mail, the injunction could push the deal into mid-2023. However, if the Competition Bureau doesn’t obtain a stay, then the deal could close as soon as ISED signs off on it, which could be as early as January.
In a joint statement, Rogers and Shaw said they “remain committed to these pro-competitive transactions” and called the tribunal’s decision “the right one.”
“We are deeply disappointed that the Commissioner continues to attempt to deny Canada and Canadians the advantages that will come from these proposed transactions,” the companies said.
However, critics of the deal have spoken out about the rushed judgement and warned the merger would lead to higher prices for cellphones, home internet, cable, satellite, and more.
The original story continues below.
Canada’s Competition Tribunal cleared the way for the Rogers-Shaw merger to move ahead after dismissing the Competition Bureau’s application to block the proposed $26 billion acquisition.
The deal still requires approval from Innovation, Science and Economic Development Canada (ISED) and a spokesperson for Minister François-Philippe Champagne told The Globe and Mail that ISED is reviewing the tribunal’s decision and “will have more to say in due course.”
The Competition Tribunal released a summary of its decision on December 29th and plans to release a more detailed decision in the next two days. The summary notes that the tribunal found the merger would not result in materially higher prices.
Moreover, the decision said the sale of Shaw’s Freedom Mobile to Quebecor-owned Vidéotron — a key pillar of the deal — would likely not prevent or lessen competition substantially. Earlier this year, Quebecor agreed to buy Freedom for $2.85 billion.
The tribunal also dismissed concerns that Bell and Telus would not be able to compete with the combined Rogers and Shaw.
In a joint statement, Rogers and Shaw said:
“We are pleased with the favourable decision from the Competition Tribunal and thank the Tribunal members for their work in rendering a swift decision. This is an important milestone in the regulatory process and moves us one step closer to closing a series of transformative transactions proposed by Rogers, Shaw, and Quebecor. We look forward to reviewing the details of the decision and working with the Minister of Innovation, Science and Industry so we can clear the final regulatory hurdle to close these transactions.”
“I am very disappointed that the tribunal is dismissing our application to block the merger between Rogers and Shaw. We are carefully considering our next steps,” said Matthew Boswell, commissioner of the federal Competition Bureau, in a statement on the 29th. The Competition Bureau has 30 days to appeal the tribunal’s decision.
Additionally, The Globe and Mail reported that Rogers and Shaw agreed to extend the deadline of the proposed merger into 2023. The extension requires Rogers to pay its bondholders $250 million.
Update 2022/12/30 at 10:34am ET: Added a joint statement from Rogers and Shaw along with a link to the tribunal’s summary.